(Sept 28) : Oil rose as Iran stuck to a seven-day proposal for reopening the crucial Strait of Hormuz rejected by US President Donald Trump, threatening further delays in the reopening of the crucial waterway. 

Brent advanced above US$106 a barrel, while West Texas Intermediate headed toward US$94. Tehran’s conditions are something Washington might have agreed to about a year ago, Trump told Axios in an interview on Sunday, saying that Iran has overplayed its hand. The US president said he expects negotiations to resume this week, Axios said.

Oil prices swung last week on mixed signals over diplomacy, recovering Middle East flows and uncertainty over US measures to curb record diesel prices, which Trump said Washington is looking at “very seriously.” Brent is up more than 70% this year, and on track for its third monthly gain, as the US-Iran conflict enters its eight month, adding to inflationary pressures.

Traders will continue to monitor physical flows through Hormuz, which carried about a fifth of the world’s crude and liquefied natural gas before the start of the conflict. Trump said a “record amount” of oil was taken out of the strait on Saturday night, while the Fars news agency reported Iranian forces targeted ships using unauthorized routes through the waterway. 

Regional tensions also remain elevated. Saudi-led coalition forces in Yemen said on Saturday that air defenses intercepted Houthi drones headed toward Riyadh and a missile targeting Khamis Mushait in the south. Alerts were also issued at Abha and Jazan, which host Aramco’s energy facilities.

uploaded by Isabelle Francis